Guangzhou R&F Properties Co. asked investors of its $725 million dollar-denominated bond due on January 13 to extend the maturity by six months and offered to buy back some of the bonds at a discounted price.
The company noted that if these proposals are not supported, it will not be able to fully repay the bond. The news came just as Shimao Group Holdings Ltd.'s dollar-denominated bonds fell again to an all-time low despite assurances that one unit of the company was operating normally.
China's growth slowed in November as the decline in the real estate market worsened and disruptions from Covid put a strain on the world's second-largest economy. This data underscores the extent of the challenge the Chinese government is facing in its efforts to stabilize the economy, amid escalating real estate problems.
Andrew Chan from Bloomberg Intelligence noted in his report that fears stemming from Shimao may eventually force China to take steps to save the industry.
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